Highmark drops UPMC suit, hikes up rates

Nearly a week after West Penn Allegheny Health System accused UPMC "predatory tactics," that lawsuit and another one against it will be dropped, the Pittsburgh Post-Gazettereported.

That's because under a new deal that guarantees Highmark members in-network access to all UPMC physicians and hospitals through 2014, the insurer will drop its federal lawsuit claiming the hospital used false advertising.

Highmark also plans to drop West Penn Allegheny Health System's antitrust lawsuit against UPMC if state insurance regulators approve the insurer's buyout of West Penn, reportedThe Pittsburgh Tribune-Review. So far, the U.S. Department of Justice has voiced its approval of the Highmark-West Penn affiliation.

UPMC's new deal with Highmark also includes reimbursement rates hikes, bringing Highmark's payments to the hospital closer to market rates, according to another Pittsburgh Post-Gazette article. Highmark allegedly pays 30 percent to 40 percent less than Aetna, Cigna, United Healthcare and HealthAmerica.

State lawmakers and labor unions praised the successful negotiation between UPMC and Highmark. "The fact is, we're talking about Highmark subscribers being able to use the 20 facilities and 3,000 doctors, which most of the people are worried about," state Rep. Tony DeLuca, minority chair of the Insurance Committee, told the Post-Gazette.

The SEIU Healthcare Pennsylvania is pushing for a longer-term contract, noted the Tribune-Review.

To learn more:
- read the Post-Gazettearticle on dropping the suit
- here's the Post-Gazette article on the new deal
- read the Pittsburgh Tribune-Review article